What is firm weighted average cost of capital

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Assume that your firm's marginal tax rate is 35% and that your firm has the following capital structure: Bonds coupon rate = 6% yield-to-maturity = 5.5% Market value of bonds = $25 million Book value of bonds = $30 million Common stock Book value of common shares = $25 million Market value of common shares = $50 million Required rate of return (r) = 12.60% What is your firm’s Weighted Average Cost of Capital (report as a raw number, i.e. if it is 10.43%, plug in 10.43) ?

Reference no: EM131357962

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